ISLAMABAD: After running a campaign against fuel subsidy for more than a fortnight, the government decided on Thursday to keep petroleum prices unchanged, apparently until after Eidul Fitr.

It was not before a series of twists though that Information Minister Marriyum Aurangzeb finally confirmed the prices would not be increased but without saying until when.

She told journalists in the afternoon that Prime Minister Shehbaz Sharif had rejected a summary for an increase in petroleum prices, adding that inflation-ridden people could not be punished with more financial burden for the incompetence, inefficiency and blunders of the previous government.

Within half an hour, this statement was withdrawn. “The statement regarding petrol prices is withdrawn. It’s being updated and will be issued later,” said a second announcement, which was followed by yet another statement by the minister reconfirming that the prime minister had rejected a summary for a price hike.

She said harsh conditions of increasing petroleum prices were set with the International Monetary Fund (IMF) by Imran Khan’s government to secure loans, adding that the present government was trying to minimise the additional financial burden on people affected by the worst price hike caused by the incompetence of the Khan administration.

Rates expected to be readjusted on first working day after Eid to comply with IMF conditions

Interestingly, the Oil and Gas Regulatory Authority (Ogra) — which normally moves a working paper through the ministries of energy and finance a day before the eve of every fortnight for price adjustment — had not even prepared a summary this time, given the last day falling on Saturday, an official working day.

The sources said that while price calculations were yet to be finalised, product import data available as of April 25 suggested that the import parity price of petrol and high-speed diesel increased by about Rs10 and Rs21 per litre, respectively.

This would result in a price differential claim (PDC) to oil marketing companies (OMCs) at about Rs31 and Rs73 per litre.

Also, kerosene and light diesel oil prices are also estimated to go up by Rs44 and Rs64 per litre.

The total impact of PDC payable to OMCs at these rates is estimated at Rs78bn for May, against Rs69bn in March and Rs62bn in the first 24 days of April.

Sources said prices would be readjusted on the first working day after Eidul Fitr as committed with the IMF and publicly confirmed by Finance Minister Miftah Ismail to facilitate negotiations for an expanded size of the loan programme for another year.

Sources in Ogra, petroleum division and finance division confirmed that a summary for price adjustment due on April 30 was neither moved nor available on their record.

However, daily reports on all economic indicators, including price changes, keep on flowing in the Prime Minister Office on the basis of which the premier decided to announce no change in prices before leaving for Saudi Arabia to avoid a shortage of petroleum products on panic buying.

Meanwhile, Ogra asked all the six chief secretaries of provinces, Azad Jammu and Kashmir Gilgit-Baltistan to manage visitors travelling towards tourist areas and control traffic as per parking capacity around hilly areas and also to avoid any shortage of essential commodities, including fuel, during Eid holidays.

Chief secretaries of Punjab and Khyber Pakhtunkhwa have been particularly advised to depute district coordination officers to manage the affairs and avoid any untoward incident.

The regulator also directed all OMCs to maximise their supplies towards northern parts to ensure smooth and uninterrupted fuel supplies at the main consumption areas.

Ogra’s enforcement teams have been directed to inspect and verify stocks at depots and monitor fuel supply closely.

Published in Dawn, April 29th, 2022